Tech

6 Questions With LevelUp Founder Seth Priebatsch

AUSTIN — Want to buy a concession at the Austin Convention Center? Just use your phone — mobile payments startup LevelUp is accepted at every kiosk during SXSWi 2013. It's an exciting time for the startup, which launched in 2011 and hit 1 million users just last week, only four months after hitting 500,000 users. We caught up with orange-adorned Seth Priebatsch at Mashable House to ask him six essential questions.

1. Mobile payments are exploding — what made you refocus your energies from SCVNGR and shift toward mobile payments? How did you know this would be a good road to go down?

So the honest answer is actually by doing something very wrong to start. LevelUp is the second product from SCVNGR, and SCVNGR is great but it's not great for driving transactions to local businesses. It is great for engagement and fun, but we ended up running these major promotions where we did drive millions of dollars of revenue but we couldn't prove anything.

So we said, 'Well, we've got the game mechanics to to motivate the user, and we've got the mobile app to track it all.' But we were somehow missing that moment where everything comes to pass at the transaction, and that was really the genesis for us to try it out. And that's worked exceptionally well for us. Unlike a lot of the other mobile payment companies, we're not all that interested in letting you pay with your phone, that's not that much better than paying with your credit card. It's almost a magic trick more than anything else. But, focusing on what we can do beyond that — adding value with savings with loyalty, speed and convenience — that has been a really good path for us.

2. Star Wars or Star Trek?

Oh, I would have to go with Star Trek but only because of the reboot, and the first one was so awesome that we actually have a company promise that the entire company will go see Into Darkness at midnight together, so we're really excited.

Dressed up?

Not dressed up — that will not be a requirement, but a recommendation.

3. What is your favorite denomination of money?

So for a while it was the Zimbabwean dollar, because I actually had a Monopoly set of Zimbabwean dollars with my family in South Africa, and they go up to trillions. So you literally have a trillion dollar bill, where the zeros go all the way across. And that's pretty cool.

I only pay with my phone though, I don't use cash anymore. And in terrible circumstances I am forced to pay with my debit card.

What happens if you go somewhere that only accepts cash?

I try and sell them on LevelUp immediately. I say you can download the app right now, you can be a merchant and you'll win my business. It's not always successful, but I try.

4. So you recently hit one million users, what is next for Level Up? What does the next year look like?

A lot more million users, one hopes. It took us 14 months to hit the first half million, and then four months thereafter to get to one million, so it is ramping up really quickly. My honest take on the space is, forget Level Up and its competitors, we've got this year to prove to general American society that mobile payments is worth having. We basically go through cycles, and we're interested in photos with filters and certain things for a short amount of time, and if it doesn't happen, if it doesn't become real, we'll move on to the next exciting thing.

I think in 2013, we're either going to make mobile payments real and relevant for everybody, or we're going to have to wait for the next cycle. So we're pedal to the metal trying to make sure that we do that literally in the next 10 months.

5. The classic entrepreneur story is that of an 8-year-old kid with a lemonade stand, did you ever have that?

Actually, yes! We were maybe 12 at the time. I convinced the city of Boston to give me and my friend permits to operate a homemade lemonade stand on Newbury Street, which is the fancy street in Boston. So we'd get away with selling bottles of water for $3 and $2.50 for lemonade. We were making $1,000 a day as 12 year olds, and we got the permit because we walked in and just said 'We're cute little kids, you've got to let us do this,' and it just kind of went from there.

6. Are you going to ever change your uniform, will we ever see you in another outfit?

Probably not. When I was pitching the company for the first time ever at the Princeton Business Line competition, I had no logo, no product, no anything. But Princeton's color is orange, so I figured the judges liked the color orange, and I just draped everything in orange, wore orange and won. So it just stuck. So literally there is no significance to it except for that. I have five total polos and they're all orange. Consistency, makes it easy.

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